Let's be clear what welfare is and is not. Welfare is not charity.
Welfare is a system of payments made to the poor not to take any job
if its pay is so low that it underbids wages for those who have
jobs. When linked to other policies like the minimum wage, welfare
is (and should be seen as) an economic tool by society to keep wages
high.
Conservatives try to argue that even if kicking people off welfare
causes some erosion in wages, it's cheaper than increasing the taxes
needed to pay people on welfare. The obvious response is to point
out how small a portion of the federal budget is taken up by
programs like AFDC and other payments to the non-working poor. Out
of a $1.6 trillion federal budget, only $19 billion goes to AFDC,
just over 1% of every federal dollar spent.
I call bullshit.
I take it this guy is referring to the U.S. because only the U.S.
federal government has a 1.6 trillion dollar(now it is above 2
trillion dollars) yearly budget.
I understand what the guy is saying...by giving some poor
people free money and keeping them out of the workplace, we
ensure that wages stay at a certain "floor", and the employment
sector is not flooded with cheap labor. He seems to insinuate that
paying this free money to poor people is actually better for the
economy than having them work.
However, the federal government gives out much more than $19 billion
to poor or non-working people. If it was only $19 billion, then
what he was saying would be true. I don't have specific statistics
on hand, but I once saw a statistic that said almost $400 billion
in "entitlements" was given out last year. Entitlements are
when you give free money or services to people. The money to pay
for those entitlements comes from taxes.
$19 billion could not possibly cover all of this free stuff that poor or non-working people get:
1. Social Security giving money to people who are disabled.
2. Public subsidized housing projects(which are all over the
place). How much you pay in rent depends on how much you make. If
you make nothing, you pay no rent. If you make something, you
pay a certain percentage(which never amounts to how much it costs
to maintain the apartment). The government is giving TONS of people
free or heavily reduced places to live. And people who pay taxes
pick up the tab.
3. Medicaid is a government program that gives some poor people
free medical care. If you are poor and you get pregnant, the
government will pay for your checkups, all costs associated with
birth, and post-birth checkups. The taxpayers pay for this.
4. Medicare is a government program that gives a lot of older
people free or heavily reduced medical care. The taxpayers pay
for this.
5. Food Stamps are coupons that can only be used to buy food. They
are given to poor people for free. The taxpayers pay for this.
6. WIC is a program that gives coupons to poor mothers. The coupons
can be used to buy baby formula, milk, diapers, etc... The taxpayers
pay for this.
And let's not forget the more indirect ways that the poor take
money from taxpayers in America.
a. Public schools are open to every child free of charge. They
are funded through local property taxes, state grants(which
come from state or state sales tax that people pay), and federal
grants(which comes from federal taxes that people pay). Poor people
don't pay federal tax. Poor people living in public subsidized
housing often don't pay rent and therefore they are not contributing
to any property taxes. The only taxes that poor people pay are
state sales tax and state income(if they have any income) tax.
So, poor parents contribute little tax money to the "system", and are
guaranteed education for their children, thus spending more than
they contribute.
b. Poor people going to college or technical school are eligible
for grants(free money) and no-interest loans(which the government
is losing money off of). The money to pay for this stuff comes
from taxpayers.
c. All of the things that the government provides(free public
education, military protection, roads, etc...) are funded mainly
through the efforts of the middle-class and the rich. Poor
people enjoy a lot of free services and don't contribute hardly
anything.
Whenever I see foreigners(or even Americans) bemoan how America
"treats its poor so badly", I become enraged. The poor in this
country get tons of free stuff. The social programs here are not
as all-encompassing as they are in Canada or maybe Sweden, but they
are prevalent and costing the taxpayers TONS of money. There is
ample socialism here and we don't need anymore.
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